BIN OR MEND?

So here’s the thing about leasehold and flats.  With this form of tenure there is always going to be a separation of some description between the contractual rights of usage of the flat and the legal ownership of the bricks and mortar of which it is built.  That is to say unless you either own the freehold of the building outright, or perhaps a share of it, then all you will really ‘own’ are contractual rights of usage for a defined period of time. 

Leasehold has been coming in for increasing amounts of flack over recent years with talk of its ‘feudal’ nature stirring up division between the greedy and unfair freeholder and the poor oppressed leaseholder and there is certainly a great deal of truth in that.  Feudal, however, it is not and there is a strongly held belief among the professional community (and not just self-interest I might say) that the system is well capable of sensible repair rather than trying to sweep it away for political expediency. Is re-inventing the wheel, which is the way a cynical person might perhaps describe commonhold, really going to be the best answer?

I have seen, and continue to see, leaseholders being unfairly treated in varying degrees as they look to extricate themselves from shortening terms, onerous ground rents and exploitative management situations.  As things stand I would have to say that the system rather favours the freeholder who is often the more canny and experienced party in it and has learnt how to work the system to its advantage (technically a freeholder is an ‘it’ by the way and there are those, I’m sure, who would see that as a fitting pronoun).  You will no doubt be hearing the word ‘commonhold’ over the coming months and years as it has become the imagined panacea for all leasehold woes.  In simple terms it’s a legalistic attempt to merge the ownership and rights of occupation and usage into the one body.  Basically everyone ‘owns’ their own flat but obviously subject to all the necessary arrangements whereby everyone’s interests are properly protected and catered for.

That last bit is actually what the leasehold system has been designed to do all along.  It’s just got a bit out of kilter over the years.  So why might we be better off trying to fix what we have than trying (yet again I must say) to bring us all to the commonhold table?  Well here’s my view and it comes from a fair amount of experience gained over the years.  Where you have a freeholder effectively presiding over the group of leaseholders in a building there is a clear ‘us and them’ situation where the leaseholders tend to unite against a common enemy.  Give them the weapons to fight on level terms, weapons which they do not presently possess it must be said, and pretty much all of the standard problems can be resolved with everyone knowing who they are and what they stand for.  Basically it’s fixable.  Try and give all of the those flat ‘owners’ a share in their building and expect them to live together in perpetual contentment and agreement and you will likely begin to realise why communism maybe wasn’t such a great idea after all.  It’s just a thought that you may want to keep in mind as the government of the day crawls slowly onward towards some utopian objective.

I’m writing now in late summer 2024 with a newly ensconced Labour government apparently set to ‘sort of’ carry on the work of the outgoing Tory outfit who frankly have been pissing around with it since 2017 going around in circles and causing untold damage from the uncertainty they were creating.  For the record we now today have the Leasehold and Freehold reform Act of 2024.  That’s a piece of ‘legislation’ that was rushed through as they prepared to vacate the sinking ship.  Littered with half-arsed nonsense, missing out substantial bits that had always intended to be included and, quite significantly one might say, requiring additional secondary legislation before it is implemented it would not be entirely unfair to say ‘and what exactly was the point of all that’?

I’ll summarise where I think we are at the moment.  We’re waiting to see what the new guys are going to do with the existing act.  Tweek it, amend it, add to it, bin it and replace with something entirely of their own devices?  Who knows.  This is government we’re talking about here.  One thing is for sure (well I have a small wager on it anyway) and that is it wouldn’t be the best idea to be holding your breath expecting something wonderful (from a leaseholder’s perspective) to happen any time soon.  By that I mean next week, next month or even next year.   Even when it does look like it’s gaining a bit of momentum there will be many of us not unduly surprised to see the freehold community closing ranks on their human rights (and it’s started already) in having, in most cases, legitimately acquired assets wrested from them without due compensation. 

Trust me this isn’t over – not by a long chalk.